Artists, Insiders Speculate About Effects Of Universal/Polygram Merger As D-Day Comes

Girls Against Boys say the marketing plan behind its latest album on DGC hinged on the second single.

Too bad you never heard it.

Sources at Mercury Records concede that the Cardigans' recent follow-up to its auspicious debut fell victim to label neglect. The reason for these disappointments? It might have been the preoccupied employees and executives at both labels -- each part of the biggest corporate shakeup in music business history.

Six major-label conglomerates shrink to five this month, as Seagram's merges their newly purchased Polygram Music Group with its own Universal Music Group. Geffen Records, A&M, Interscope, MCA, Island, Mercury, Universal, Motown and Def Jam will form one single empire (restructured and divided into four major label groups, two on each coast) which will control an estimated 25 percent of the world's music market.

"The idea is that they will join the labels together, trim the roster, trim the staff, take the best of everything

to hopefully have the biggest and best record label in the world," observed Julie Gordon, whose Velvet Rope website gives music industry insiders a place to chat, share, and dish.

The first of those moves happened on Thursday, dubbed "D-Day" in the industry, as hundreds of label employees received their pink slips. The publicity department at A&M Records has already been largely vaporized, and A&M artists Sheryl Crow and Chris Cornell were even in the label's Los Angeles offices on Thursday to say farewell to departing staffers. The moves have been coming for some time, making for an atmosphere that is hardly conducive to productivity.

"Many employees are about to get fired," Girls Against Boys bassist Johnny Temple said, "so it's hard to do a good job working on a band's career when you don't know where you stand with your boss." [28.8 RealVideo]

"If they're gonna have

a whole set of new relationships and the people that originally had the passion and belief in the artist are no longer there, will they have the follow-through?" TVT Records head Steve Gottlieb asked rhetorically. "A lot of the cuts may be mutual."

Amid the tumult, some A-list artists are making their own moves. With Island Records under new management, U2 will leave its career-long label and head for Interscope, where they'll be overseen by producer-turned-executive Jimmy Iovine. Meanwhile, Sting is set to leave A&M for Mercury Records.

"This is gonna be an organization, Unigram, that's gonna have a hard time functioning as a seamless entity for many months if not a couple years,"[28.8 RealVideo] Gottlieb said.

And so consumers may need to be patient, as a number of artists will likely follow the lead of Insane Clown Posse, who will delay turning over nearly-completed new material until the merger-dust has settled.

Despite these short-term ramifications, however, downsizing may have its advantages.

"It can be good for the industry in the sense that are too many bands getting signed every year," Gordon said. "If you think about how many albums come out every year versus how many are successful, probably now labels will have to sign fewer acts and that will be better for the industry."

Or will it? What about the quality of future signings? Some fear that enhanced corporate pressure to turn a quick buck will only increase the number of here-today/gone-tomorrow artists that have become a staple of the 90s.

"The day of having a band like the Ramones that stays on a major label for 22 years and has a strong base seems over," Geffen artist Rob Zombie told MTV News. "You're either a smash or you're nothing, and the labels don't want to deal with careers anymore, they just want a pop hit for that quarter

and then they wanna dump you." [28.8 RealVideo]

"You have a company that has a bottom line that has to be met and anxious shareholders that want to see a profit and want to see a profit fast," Gordon said. "Artist development takes time. It usually doesn't happen in one record or one tour or one single."

For an example, look no further than the Wallflowers. After a disappointing debut, Virgin Records didn't have the patience to stick around for album number two and dropped the band. Four years later, Interscope took a chance. Both label and band won big as the band's second effort sold more than four million copies. Will such major-label second-chances be fewer and farther between in the future?

Acts on the corporate precipice hold out hope that dropped bands and laid-off execs will come together in a blaze of music biz entrepreneurship, and set off an indie-label explosion.

"I think there's going to be a lot of new labels started up by former

executives and former employees," GVSB drummer Alexis Fleisig theorized. "They're just going to start their own companies, and they have realistic expectations. I mean, a major company has such a large overhead that they have to have a band that sells millions and millions of records to keep them afloat, whereas an independent label can sell thousands of records and do very well."

Will the Universal/Polygram merger bring about a new era of glory for indie labels? Will the new multi-armed beast known as Unigram find a balance between commercial success and artistic credibility with artists like DMX, Marilyn Manson, Jay-Z, Nine Inch Nails, Foxy Brown, No Doubt, Method Man, Garbage and others in its stable? The answers to these questions, and many more, may not be visible until long after the D-Day dust has settled.